Halliburton Gulf Oil Spill Settlement Will Shield Company from Billions in Liability
Legal victory behind it, Halliburton expected to pursue new oil profits
Halliburton's $1.1 billion settlement, announced Tuesday, for its role in the 2010 Deepwater
by BP to cement the Macondo oil well, stands accused of doing defective work and thus paving the way for the worst offshore oil spill in U.S. history, which killed 11 workers, spilled millions of gallons of oil into Gulf waters, and continues to pollute beaches and harm public health in affected areas.
Both Halliburton and BP have exchanged accusations and lawsuits charging that the other company is responsible for the faulty well. While a White House Panel report, released in 2011, assigned responsibility to BP, Transocean, and Halliburton for the spill, a federal judge in 2012 ruled that BP bears the bulk of the liability for damages.
In October 2013, Halliburton pleaded guilty to criminal charges of destroying evidence related to the oil spill.
Experts say the agreement, which settles most of Halliburton's cases with people, small businesses, and government entities, will likely help the company avoid billions of dollars in payouts. “It’s actually a pretty decent settlement for [Halliburton],” Rob Desai, an analyst at Edward Jones in St. Louis, told Bloomberg. “This eliminates an overhang.” The settlement still must be approved by the federal court in Louisiana.
The New York Times adds:
Legal scholars following the case said that Halliburton was making a calculated judgment that it was preferable to agree to pay the relatively modest $1.1 billion than face larger liabilities in the future. They said the settlement should resolve most of its remaining liability for the spill, even if the company is found to have been grossly negligent by Judge Carl J. Barbier of Federal District Court in New Orleans.
While the company insists that the agreement includes no admission of liability for the disaster, David Uhlmann, a law professor at the University of Michigan and a former chief of the Justice Department’s environmental crimes section, told the New York Times that "the company would never have agreed to pay more than a billion dollars unless there was substantial evidence that it was negligent."
Bloomberg reports, "With its biggest piece of liability resolved, Halliburton can refocus its attention on developing new oilfield technology that will help it boost profits worldwide."